American Tower (AMT) 10-Q 6 May 10 2010 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information
	3 Months Ended Mar. 31, 2010	Apr. 23, 2010
Document Type	10-Q
Amendment Flag	false
Document Period End Date	2010-03-31
Document Fiscal Year Focus	2,010
Document Fiscal Period Focus	Q1
Trading Symbol	AMT
Entity Registrant Name	AMERICAN TOWER CORP /MA/
Entity Central Index Key	0001053507
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		403,433,184

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $)
In Thousands	3 Months Ended Mar. 31, 2010	12 Months Ended Dec. 31, 2009
CURRENT ASSETS:
Cash and cash equivalents	$352,887	$247,293
Restricted cash	49,794	47,836
Short term investments and available-for-sale securities	18,945	9,776
Accounts receivable, net	73,541	67,949
Prepaid and other current assets	107,208	89,051
Deferred income taxes	216,822	189,451
Total current assets	819,197	651,356
PROPERTY AND EQUIPMENT, net	3,179,196	3,175,511
GOODWILL	2,246,170	2,237,850
OTHER INTANGIBLE ASSETS, net	1,655,608	1,598,633
DEFERRED INCOME TAXES	105,976	198,185
NOTES RECEIVABLE AND OTHER LONG-TERM ASSETS	668,104	651,133
TOTAL	8,674,251	8,512,668
CURRENT LIABILITIES:
Accounts payable and accrued expenses	183,854	185,138
Accrued interest	44,024	23,538
Current portion of long-term obligations	77,905	70,521
Unearned revenue	117,028	112,047
Total current liabilities	422,811	391,244
LONG-TERM OBLIGATIONS	4,152,030	4,141,060
OTHER LONG-TERM LIABILITIES	641,564	662,239
Total liabilities	5,216,405	5,194,543
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Preferred Stock: $.01 par value; 20,000,000 shares authorized; no shares issued or outstanding
Class A Common Stock: $.01 par value, 1,000,000,000 shares authorized, 482,981,759 and 479,703,633 shares issued, and 403,691,679 and 401,596,984 shares outstanding, respectively	4,830	4,797
Additional paid-in capital	8,447,667	8,393,643
Accumulated deficit	(2,013,214)	(2,109,532)
Accumulated other comprehensive income (loss)	28,320	(12,649)
Treasury stock (79,290,080 and 78,106,649 shares at cost, respectively)	(3,012,693)	(2,961,177)
Total American Tower Corporation stockholders' equity	3,454,910	3,315,082
Noncontrolling interest	2,936	3,043
Total stockholders' equity	3,457,846	3,318,125
TOTAL	$8,674,251	$8,512,668

1_CONDENSED CONSOLIDATED BALANC

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)
	Mar. 31, 2010	Dec. 31, 2009
Preferred Stock, par value	0.01	0.01
Preferred Stock, shares authorized	20,000,000	20,000,000
Preferred Stock, shares issued	0	0
Preferred Stock, shares outstanding	0	0
Class A Common Stock, par value	0.01	0.01
Class A Common Stock, shares authorized	1,000,000,000	1,000,000,000
Class A Common Stock, shares issued	482,981,759	479,703,633
Class A Common Stock, shares outstanding	403,691,679	401,596,984
Treasury stock, shares	79,290,080	78,106,649

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)
In Thousands, except Per Share data	3 Months Ended Mar. 31, 2010	3 Months Ended Mar. 31, 2009
REVENUES:
Rental and management	$443,818	$395,947
Network development services	10,616	12,731
Total operating revenues	454,434	408,678
Costs of operations (exclusive of items shown separately below)
Rental and management	100,424	90,090
Network development services	6,045	7,615
Depreciation, amortization and accretion	110,835	99,868
Selling, general, administrative and development expense (including stock-based compensation expense of $13,565 and $24,338, respectively)	53,527	57,631
Other operating expenses	4,754	3,189
Total operating expenses	275,585	258,393
OPERATING INCOME	178,849	150,285
OTHER INCOME (EXPENSE):
Interest income, TV Azteca, net of interest expense of $372 and $372, respectively	3,499	3,499
Interest income	502	499
Interest expense	(58,417)	(61,568)
Other income	396	71
Total other expense	(54,020)	(57,499)
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND INCOME ON EQUITY METHOD INVESTMENTS	124,829	92,786
Income tax provision	(28,389)	(37,107)
Income on equity method investments	8	10
INCOME FROM CONTINUING OPERATIONS	96,448	55,689
INCOME FROM DISCONTINUED OPERATIONS, NET OF INCOME TAX PROVISION OF $(23) AND $(1,930), RESPECTIVELY	35	3,070
NET INCOME	96,483	58,759
Net income attributable to noncontrolling interest	(165)	(158)
NET INCOME ATTRIBUTABLE TO AMERICAN TOWER CORPORATION	$96,318	$58,601
BASIC:
Income from continuing operations attributable to American Tower Corporation	0.24	0.14
Income from discontinued operations attributable to American Tower Corporation		0.01
Net income attributable to American Tower Corporation	0.24	0.15
DILUTED:
Income from continuing operations attributable to American Tower Corporation	0.24	0.14
Income from discontinued operations attributable to American Tower Corporation		0.01
Net income attributable to American Tower Corporation	0.24	0.15
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
BASIC	402,346	397,180
DILUTED	406,080	408,250

2_CONDENSED CONSOLIDATED STATEM

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) (USD $)
In Thousands	3 Months Ended Mar. 31, 2010	3 Months Ended Mar. 31, 2009
Selling, general, administrative and development expense, stock-based compensation expense	$13,565	$24,338
Interest income, TV Azteca, interest expense	372	372
INCOME FROM DISCONTINUED OPERATIONS, INCOME TAX PROVISION	($23)	($1,930)

3_CONDENSED CONSOLIDATED STATEM

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)
In Thousands	3 Months Ended Mar. 31, 2010	3 Months Ended Mar. 31, 2009
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$96,483	$58,759
Adjustment to reconcile net income to cash provided by operating activities:
Stock-based compensation expense	13,565	24,338
Depreciation, amortization and accretion	110,835	99,868
Other non-cash items reflected in statements of operations	34,625	38,525
Increase in net deferred rent asset	(6,430)	(2,717)
Increase in restricted cash	(2,909)	(9,609)
Increase in assets	(23,093)	(23,367)
Increase in liabilities	30,573	19,941
Cash provided by operating activities	253,649	205,738
CASH FLOWS FROM INVESTING ACTIVITIES:
Payments for purchase of property and equipment and construction activities	(55,057)	(49,627)
Payments for acquisitions	(88,487)	(1,145)
Proceeds from sale of available-for-sale securities and other long-term assets	1,075	1,144
Deposits, restricted cash, investments and other	(8,211)	1,120
Cash used for investing activities	(150,680)	(48,508)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings under credit facilities	75,000
Repayments of notes payable, credit facilities and capital leases	(60,709)	(1,155)
Purchases of Class A common stock	(58,836)	(4,661)
Proceeds from stock options, warrants and stock purchase plan	47,469	8,898
Deferred financing costs and other financing activities	(274)	(99)
Cash provided by financing activities	2,650	2,983
Net effect of changes in foreign currency exchange rates on cash and cash equivalents	(25)	(252)
NET INCREASE IN CASH AND CASH EQUIVALENTS	105,594	159,961
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR	247,293	143,077
CASH AND CASH EQUIVALENTS, END OF PERIOD	352,887	303,038
CASH PAID FOR INCOME TAXES	7,899	7,494
CASH PAID FOR INTEREST	$35,842	$39,111

4_CONDENSED CONSOLIDATED STATEM

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (USD $)
In Thousands, except Share data	Class A Common Stock	Treasury Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit	Noncontrolling Interest	Total Comprehensive Income (Loss)	Total
BEGINNING BALANCE at Dec. 31, 2008	$4,685	($2,746,429)	$8,109,224	($20,031)	($2,356,127)	$3,157		$2,994,479
BEGINNING BALANCE (in shares) at Dec. 31, 2008	468,513,843	(71,536,947)
Share based compensation related activity (in shares)	740,681
Share based compensation related activity	7		30,653					30,660
Issuance of common stock upon exercise of warrants (in shares)	8,573
Issuance of common stock upon exercise of warrants			38					38
Treasury stock activity (in shares)		(67,438)
Treasury stock activity		(1,836)						(1,836)
Net change in fair value of cash flow hedges, net of tax				300			300	300
Net realized gain (loss) on cash flow hedges, net of tax				29			29	29
Net unrealized gain (loss) on available-for-sale securities, net of tax				9			9	9
Foreign currency translation adjustment				(203)			(203)	(203)
Distributions to noncontrolling interest						(165)		(165)
Net income					58,601	158	58,759	58,759
Total comprehensive income							58,894
ENDING BALANCE (in shares) at Mar. 31, 2009	469,263,097	(71,604,385)
ENDING BALANCE at Mar. 31, 2009	4,692	(2,748,265)	8,139,915	(19,896)	(2,297,526)	3,150		3,082,070
BEGINNING BALANCE at Dec. 31, 2009	4,797	(2,961,177)	8,393,643	(12,649)	(2,109,532)	3,043		3,318,125
BEGINNING BALANCE (in shares) at Dec. 31, 2009	479,703,633	(78,106,649)
Share based compensation related activity (in shares)	1,647,065
Share based compensation related activity	17		47,181					47,198
Issuance of common stock upon exercise of warrants (in shares)	1,631,061
Issuance of common stock upon exercise of warrants	16		6,843					6,859
Treasury stock activity (in shares)		(1,183,431)
Treasury stock activity		(51,516)						(51,516)
Net change in fair value of cash flow hedges, net of tax				1,519			1,519	1,519
Net realized gain (loss) on cash flow hedges, net of tax				30			30	30
Net unrealized gain (loss) on available-for-sale securities, net of tax				12			12	12
Foreign currency translation adjustment				39,408			39,408	39,408
Distributions to noncontrolling interest						(272)		(272)
Net income					96,318	165	96,483	96,483
Total comprehensive income							137,452
ENDING BALANCE (in shares) at Mar. 31, 2010	482,981,759	(79,290,080)
ENDING BALANCE at Mar. 31, 2010	$4,830	($3,012,693)	$8,447,667	$28,320	($2,013,214)	$2,936		$3,457,846

Description of Business, Basis

Description of Business, Basis of Presentation and Accounting Policies
	3 Months Ended Mar. 31, 2010
Description of Business, Basis of Presentation and Accounting Policies	1. Description of Business, Basis of Presentation and Accounting Policies American Tower Corporation is, together with its subsidiaries (collectively, ATC or the Company), an independent developer, owner and operator of wireless and broadcast communications sites in the United States, Mexico, Brazil and India. The Companys primary business is the leasing of antenna space on multi-tenant communications sites to wireless service providers and radio and television broadcast companies. The Company also manages rooftop and tower sites for property owners, operates in-building and outdoor distributed antenna system (DAS) networks, and provides network development services that support its rental and management operations and the addition of new tenants and equipment on its sites. ATC is a holding company that conducts its operations through its directly and indirectly owned subsidiaries. ATCs principal United States operating subsidiaries are American Towers, Inc. (ATI) and SpectraSite Communications, LLC (SpectraSite). ATC conducts its international operations through its subsidiary, American Tower International, Inc., which in turn conducts operations through its various international operating subsidiaries. The Companys international operations consist of its operations in Mexico, Brazil and India. The accompanying condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). The financial information included herein is unaudited; however, the Company believes that all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of the Companys financial position and results of operations for such periods have been included. Results of interim periods may not be indicative of results for the full year. The Company considers events or transactions that occur after the balance sheet date but before the financial statements are issued as additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated up to the date of issuance of these financial statements. These condensed consolidated financial statements and related notes should be read in conjunction with the Companys Annual Report on Form 10-K for the year ended December31, 2009. Significant Accounting Policies and Use of EstimatesThe preparation of financial statements in conformity with accounting principles generally accepted in the United States (GAAP) requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results may differ from those estimates, and such differences could be material to the accompanying condensed consolidated financial statements. Concentrations of Credit RiskThe Company is subject to concentrations of credit risk related to its cash and cash equivalents, notes receivable, trade receivables, deferred rent asset and derivative instruments. The Company mitigates its risk with respect to cash and cash equivalents and deriv

Short-Term Investments and Avai

Short-Term Investments and Available-For-Sale Securities
	3 Months Ended Mar. 31, 2010
Short-Term Investments and Available-For-Sale Securities	2. Short-Term Investments and Available-For-Sale Securities As of March31, 2010, short-term investments and available-for-sale securities included Brazilian Treasury securities of approximately $18.7 million, whose original maturities were in excess of three months, and approximately $0.2 million of available-for-sale securities.

Goodwill and Other Intangible A

Goodwill and Other Intangible Assets
	3 Months Ended Mar. 31, 2010
Goodwill and Other Intangible Assets	3. Goodwill and Other Intangible Assets The changes in the carrying value of goodwill for the three months ended March31, 2010 are as follows: Balance as of December31, 2009 $ 2,237,850 Additions 5,931 Effect of foreign currency translation 2,389 Balance as of March31, 2010 $ 2,246,170 The Companys other intangible assets subject to amortization consist of the following: Estimated Useful Lives March 31, 2010 December 31, 2009 (years) (in thousands) Acquired network location (1) 20 $ 1,127,336 $ 1,101,232 Acquired customer base 15-20 762,551 756,928 Acquired customer relationship 20 949,928 883,491 Acquired licenses and other intangibles 5-15 21,574 21,574 Economic Rights, TV Azteca 70 30,292 30,292 Total 2,891,681 2,793,517 Less accumulated amortization (1,277,497 ) (1,238,579 ) Intangible assets, net 1,614,184 1,554,938 Deferred financing costs, net (2) N/A 41,424 43,695 Other intangible assets, net $ 1,655,608 $ 1,598,633 (1) Acquired network location intangibles are amortized over the shorter of the term of the corresponding ground lease or 20 years, as the Company considers these intangibles to be directly related to the tower assets. (2) Deferred financing costs are amortized over the term of the respective debt instruments to which they relate. This amortization is included in interest expense, rather than in amortization of intangibles. The Company amortizes these intangibles on a straight-line basis. As of March31, 2010, the remaining weighted average amortization period of the Companys intangible assets, excluding the TV Azteca Economic Rights detailed in note 4 to the Companys consolidated financial statements included in the Companys Annual Report on Form 10-K for the year ended December31, 2009, was approximately 11 years. Amortization of intangible assets for the three months ended March31, 2010 and 2009 aggregated approximately $37.8 million and $32.1 million (excluding amortization of deferred financing costs, which is included in interest expense), respectively.

Financing Transactions

Financing Transactions
	3 Months Ended Mar. 31, 2010
Financing Transactions	4. Financing Transactions Revolving Credit Facility and Term LoanAs of March31, 2010, the Company had $625.0 million outstanding under its $1.25 billion senior unsecured revolving credit facility (Revolving Credit Facility) and had approximately $3.1 million of undrawn letters of credit outstanding. In March 2008, the Company increased its borrowing capacity under the Revolving Credit Facility by adding $325.0 million of term loan commitments (Term Loan). As of March31, 2010, the Term Loan was fully drawn. The Company continues to maintain the ability to draw down and repay amounts under the Revolving Credit Facility in the ordinary course. XCEL Credit FacilityAt the time of the Companys acquisition of XCEL on May27, 2009, a 4.8 billion Indian Rupee-denominated credit facility (XCEL Credit Facility) was in place, of which 3.4 billion Indian Rupees was outstanding. As of March31, 2010, 3.4 billion Indian Rupees, or $76.4 million, was outstanding under the XCEL Credit Facility. In April 2010, the Company repaid all of the outstanding indebtedness incurred under the XCEL Credit Facility. The Company terminated the XCEL Credit Facility upon repayment. Stock Repurchase ProgramDuring the three months ended March31, 2010, the Company repurchased an aggregate of 1.2million shares of its ClassA common stock (Common Stock) for an aggregate of $51.5 million, including commissions and fees, pursuant to its $1.5 billion stock repurchase program approved by the Companys Board of Directors in February 2008 (2008 Buyback). Under the 2008 Buyback, the Company is authorized to purchase shares from time to time through open market purchases or privately negotiated transactions at prevailing prices in accordance with securities laws and other legal requirements, and subject to market conditions and other factors. To facilitate repurchases, the Company purchases its Common Stock pursuant to trading plans under Rule 10b5-1 of the Securities Exchange Act of 1934, as amended, which allows the Company to repurchase shares during periods when it otherwise might be prevented from doing so under insider trading laws or because of self-imposed trading blackout periods. In the near term, the Company expects to fund any further repurchases of its Common Stock through a combination of cash on hand, cash generated by operations and borrowings under its Revolving Credit Facility. Purchases under the 2008 Buyback are subject to the Company having available cash to fund repurchases.

Derivative Financial Instrument

Derivative Financial Instruments
	3 Months Ended Mar. 31, 2010
Derivative Financial Instruments	5. Derivative Financial Instruments The Company is exposed to certain risks related to its ongoing business operations. The primary risk managed through the use of derivative instruments is interest rate risk. The Company enters into interest rate protection agreements to manage exposure on the variable rate debt under its credit facilities and to manage variability in cash flows relating to forecasted interest payments. Under these agreements, the Company is exposed to credit risk to the extent that a counterparty fails to meet the terms of a contract. The Companys credit risk exposure is limited to the current value of the contract at the time the counterparty fails to perform. The Company believes its contracts as of March31, 2010 are with creditworthy institutions. If a derivative is designated as a cash flow hedge, the effective portions of changes in the fair value of the derivative are recorded in accumulated other comprehensive income (loss) and are recognized in the results of operations when the hedged item affects earnings. Ineffective portions of changes in the fair value of cash flow hedges are recognized immediately in the results of operations. For derivative instruments not designated as hedging instruments, changes in fair value are recognized in the results of operations in the period in which the change occurs. As of March31, 2010, the Company held thirteen interest rate swap agreements, all of which have been designated as cash flow hedges, and which have an aggregate notional amount of $625.0 million, interest rates ranging from 2.86% to 4.08% and expiration dates through March 2011. The Company utilizes these interest rate swap agreements to manage its exposure to variability in cash flows relating to forecasted interest payments under its Revolving Credit Facility and Term Loan. As of March31, 2010 and December31, 2009, the carrying amounts of the Companys derivative financial instruments, along with the estimated fair values of the related liabilities are as follows (in thousands): As of March31, 2010 Balance Sheet Location Notional Amount CarryingAmount and Fair Value Liabilities: Interestrateswapagreements Other long-term liabilities $ 625,000 $ 16,367 As of December31, 2009 Balance Sheet Location Notional Amount Carrying Amount and Fair Value Liabilities: Interest rate swap agreements Other long-term liabilities $ 625,000 $ 18,852 During the three months ended March31, 2010 and 2009, the interest rate swap agreements held by the Company had the following impact on other comprehensive income (OCI) included in the condensed consolidated balance sheet and in the condensed consolidated statement of operations (in thousands): Three Months Ended March31, 2010 Amount of Gain/(Loss) Recognized in OCI on Derivatives (Effective Portion) Location of Gain/ (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) Amount of Gain/ (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) Location of Gain/ (Loss) Recognized in Income on Derivati

Fair Value Measurements

Fair Value Measurements
	3 Months Ended Mar. 31, 2010
Fair Value Measurements	6. Fair Value Measurements The Company determines the fair market values of its financial instruments based on the fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Below are the three levels of inputs that may be used to measure fair value: Level1 Quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level2 Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Items Measured at Fair Value on a Recurring BasisThe fair value of the Companys financial assets and liabilities that are required to be measured on a recurring basis at fair value is as follows: March 31, 2010 Fair Value Measurements Using Assets/Liabilities at Fair Value Level1 Level2 Level3 (in thousands) Assets: Short-term investments and available-for-sale securities(1) $ 18,945 $ 18,945 Liabilities: Interest rate swap agreements (2) $ 16,367 $ 16,367 December 31, 2009 Fair Value Measurements Using Assets/Liabilities at Fair Value Level1 Level2 Level3 (in thousands) Assets: Short-term investments and available-for-sale securities (1) $ 9,776 $ 9,776 Liabilities: Interest rate swap agreements (2) $ 18,852 $ 18,852 (1) Consists of available-for-sale securities traded on active markets as well as certain Brazilian Treasury securities that are highly liquid and actively traded in over-the-counter markets. (2) Consists of interest rate swap agreements based on the London Interbank Offering Rate (LIBOR) swap rate whose value is determined using a pricing model with inputs that are observable in the market or can be derived principally from, or corroborated by, observable market data. The fair value of the Companys interest rate swap agreements recorded as liabilities is included in other long-term liabilities in the accompanying condensed consolidated balance sheet as of March31, 2010. Fair valuations of the Companys interest rate swap agreements reflect the value of the instrument including the values associated with counterparty risk and the Companys own credit standing. The Company includes in the valuation of the derivative instrument the value of the net credit differential between the counterparties to the derivative contract. Items Measured at Fair Value on a Nonrecurring BasisThe Companys long-lived assets, intangibles and goodwill are measured at fair value on a nonrecurring basis. During the thr

Income Taxes

Income Taxes
	3 Months Ended Mar. 31, 2010
Income Taxes	7. Income Taxes The Company provides for income taxes at the end of each interim period based on the estimated effective tax rate for the full fiscal year. Cumulative adjustments to the Companys estimate are recorded in the interim period in which a change in the estimated annual effective rate is determined. As of March31, 2010, the Company had unrecognized tax benefits of $97.4million, of which approximately $35.7million would impact discontinued operations, if recognized.The total amount that would affect the effective tax rate, if recognized, was $52.2 million, net of deferred tax assets of $9.5million. The Company expects the unrecognized tax benefits to change over the next 12 months if certain tax matters ultimately settle with the applicable taxing jurisdiction during this timeframe, as described in note 11 to the Companys consolidated financial statements included in the Companys Annual Report on Form 10-K for the year ended December31, 2009. The impact of the amount of such changes to previously recorded uncertain tax positions could range from zero to $1.5 million. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows for the three months ended March 31, 2010 (in thousands): Balance at January 1, 2010 $ 87,975 Additions based on tax positions related to the current year 10,030 Reductions for tax positions of prior years (1,254 ) Foreign currency 700 Reduction as a result of the lapse of statute limitations (53 ) Balance at March 31, 2010 $ 97,398 The Company recorded penalties and tax-related interest expense during the three months ended March31, 2010 of $0.7 million. As of March31, 2010 and December31, 2009, the total amount of accrued income tax-related interest and penalties included in other long-term liabilities in the condensed consolidated balance sheets was $16.5 million and $15.2 million, respectively. During the three months ended March31, 2010, the Company recorded an additional tax reserve of $10.0 million. In an effort to efficiently fund Latin American operations, during the first quarter of 2010, the Company reorganized an existing financing entity, which resulted in a reversal of $32.6 million of accrued income tax liabilities which was recognized in the condensed consolidated statement of operations. The Company files numerous consolidated and separate income tax returns, including U.S. federal and state tax returns and foreign tax returns. The Company is subject to examinations in various U.S. state jurisdictions for certain tax years. As a result of the Companys ability to carry forward federal and state net operating losses, the applicable tax years remain open to examination until three years after the applicable loss carry forwards have been used or expired.

Stock-Based Compensation

Stock-Based Compensation
	3 Months Ended Mar. 31, 2010
Stock-Based Compensation	8. Stock-Based Compensation The Company recognized stock-based compensation expense during the three months ended March31, 2010 and 2009 of approximately $13.6 million and $24.3 million, respectively. Stock-based compensation expense for the three months ended March31, 2009 includes $6.6 million related to the modification of the vesting and exercise terms for a certain employees equity awards. The Company did not capitalize any stock-based compensation during the three months ended March31, 2010 and 2009. StockOptionsDuring the three months ended March31, 2010, the Company granted stock options to purchase 1.0million shares of its Common Stock pursuant to its 2007 Equity Incentive Plan (2007 Plan). The following table summarizes the Companys option activity for the three months ended March31, 2010: Number of Options Outstanding as of January 1, 2010 11,434,178 Granted 1,043,337 Exercised (1,280,955 ) Forfeited (42,427 ) Expired (21,700 ) Outstanding as of March 31, 2010 11,132,433 The Company estimates the fair value of each option grant on the date of grant using the Black-Scholes option pricing model. The following assumptions were used to determine the grant date fair value for options granted during the three months ended March31, 2010: Range of risk-free interest rate 1.90%-2.39% Weighted average risk-free interest rate 2.39% Expected life of option grants 4.6 years Range of expected volatility of underlying stock price 37.11%-37.13% Weighted average expected volatility of underlying stock price 37.13% Expected annual dividends N/A The weighted average grant date fair value per share during the three months ended March31, 2010 was $14.99. As of March31, 2010, total unrecognized compensation expense related to unvested stock options was $47.7 million, and is expected to be recognized over a weighted average period of approximately two years. Restricted Stock UnitsDuring the three months ended March31, 2010, the Company granted restricted stock units with respect to 0.9million shares of its Common Stock pursuant to the 2007 Plan. The following table summarizes the Companys restricted stock unit activity during the three months ended March31, 2010: Number of Units Outstanding as of January 1, 2010 2,026,032 Granted 868,853 Vested (526,269 ) Forfeited (23,796 ) Outstanding as of March 31, 2010 2,344,820 As of March31, 2010, total unrecognized compensation expense related to unvested restricted stock units granted under the 2007 Plan was $77.6 million, and is expected to be recognized over a weighted average period of approximately three years. Employee Stock Purchase PlanThe Company maintains an employee stock purchase plan for all eligible employees as described in note 12 to the Companys Annual Report on Form 10-K for the year ended December31, 2009. The offering periods run from June1 through November30 and from December1 through May31 of each year, and accordingly no shares were purchased by employees during the three months

Earnings per Common Share

Earnings per Common Share
	3 Months Ended Mar. 31, 2010
Earnings per Common Share	9. Earningsper Common Share Basic income from continuing operations per common share represents income from continuing operations attributable to American Tower Corporation divided by the weighted average number of common shares outstanding during the period. Diluted income from continuing operations per common share represents income from continuing operations attributable to American Tower Corporation divided by the weighted average number of common shares outstanding during the period and any dilutive common share equivalents, including shares issuable upon exercise of stock options and warrants as determined under the treasury stock method and upon conversion of the Companys convertible notes, as determined under the if-converted method. The following table sets forth basic and diluted income from continuing operations per common share computational data for the three months ended March31, 2010 and 2009 (in thousands, except per share data): Three Months Ended March31, 2010 2009 Income from continuing operations attributable to American Tower Corporation $ 96,283 $ 55,531 Effect of convertible notes 747 Income available to common shareholders, as adjusted for diluted earnings $ 96,283 $ 56,278 Basic weighted average common shares outstanding 402,346 397,180 Dilutive securities: Stock options, warrants and convertible notes 3,734 11,070 Diluted weighted average common shares outstanding 406,080 408,250 Basic income from continuing operations attributable to American Tower Corporation per common share $ 0.24 $ 0.14 Diluted income from continuing operations attributable to American Tower Corporation per common share $ 0.24 $ 0.14 For the three months ended March31, 2010 and 2009, the weighted average number of common shares outstanding excludes shares issuable upon conversion of the Companys convertible notes of 0.6million and 1.2million, respectively, and shares issuable upon exercise of the Companys stock options and share based awards of 1.4million and 10.4million, respectively, as the effect would be anti-dilutive.

Commitments and Contingencies

Commitments and Contingencies
	3 Months Ended Mar. 31, 2010
Commitments and Contingencies	10. Commitments and Contingencies Legal and Governmental Proceedings Related to Review of Stock Option Granting Practices and Related AccountingDuring the year ended December31, 2006, the Company received a letter of informal inquiry from the SEC Division of Enforcement, a subpoena from the United States Attorneys Office for the Eastern District of New York, and an Information Document Request from the Internal Revenue Service (IRS), each requesting documents and other information related to Company stock option grants and stock option practices. In addition, in August 2007, the Company received a request for information from the Department of Labor (DOL) with respect to the Companys retirement savings plan, including documents related to Company stock option grants and the Companys historical stock option administrative practices. The Company has also become aware that a former officer of the Company has received a Wells notice from the SEC, which affords such individual the opportunity to make a submission to the SEC with respect to contemplated civil enforcement recommendations against such individual for certain violations of the federal securities laws. In September 2008, the DOL concluded its review and advised the Company that no action would be taken. The reviews being conducted by the SEC, the U.S. Attorneys Office and the IRS remain ongoing, and the Company continues to cooperate on these matters. Mexico LitigationOne of the Companys subsidiaries, SpectraSite Communications, Inc. (SCI), is involved in a lawsuit brought in Mexico against a former Mexican subsidiary of SCI (the subsidiary of SCI was sold in 2002, prior to the Companys merger of a newly formed, wholly owned subsidiary with SCIs parent in 2005). The lawsuit concerns a terminated tower construction contract and related agreements with a wireless carrier in Mexico. The primary issue for the Company is whether SCI itself can be found liable to the Mexican carrier. The trial and lower appellate courts initially found that SCI had no such liability in part because Mexican courts do not have full jurisdiction over SCI. These decisions were appealed by the plaintiff, and in July 2008, they were reversed by an intermediate Mexican appellate court. In its decision, the intermediate appellate court identified potential damages of approximately $23.0 million. SCI appealed that ruling to a higher constitutional court in Mexico. In January 2009, the constitutional court ruled in SCIs favor, remanding the case back to the intermediate appellate court for further proceedings. In March 2009, the intermediate appellate court issued its decision, which reasserts jurisdiction and reimposes liability on SCI. In April 2009, as permitted under Mexican law, SCI filed an appeal of this decision to the higher constitutional court, on the grounds that the decision of the intermediate appellate court is inconsistent with the January 2009 ruling of the higher constitutional court and Mexican law. In August 2009, the plaintiff filed a petition with the Supreme Court of Mexico asking the court to rule on SCIs appeal to the constitutional court. In September 2009, the Supreme Court refus

Acquisitions

Acquisitions
	3 Months Ended Mar. 31, 2010
Acquisitions	11. Acquisitions XCEL AcquisitionOn May27, 2009, the Company acquired 100% of the outstanding common and preferred stock of XCEL for an aggregate cash purchase price of $96.0 million, after preliminary post closing price adjustments of $2.0 million. The allocation of the purchase price will be finalized upon the final settlement of the purchase price with the sellers and the subsequent completion of analyses of the fair value of XCELs assets and liabilities and certain tax matters. These analyses include examination of the underlying book and tax records, completion of an appraisal of certain tangible and intangible assets and liabilities and a full assessment of legal and tax contingencies. Insight AcquisitionOn October28, 2009, the Company acquired 100% of the outstanding stock of Insight Infrastructure Pte. Ltd. (Insight) for an aggregate cash purchase price of $18.9 million, after preliminary post closing price adjustments of $1.0 million. The allocation of the purchase price will be finalized upon the final settlement of the purchase price with the sellers and the subsequent completion of analyses of the fair value of Insights assets and liabilities and certain tax matters. These analyses include examination of the underlying book and tax records, completion of an appraisal of certain tangible and intangible assets and liabilities and a full assessment of legal and tax contingencies. Brazil AcquisitionOn July22, 2009, the Company completed its acquisition of 230 towers and related third party leases located in Brazil for an aggregate purchase price of $51.3 million, which consisted of $50.5 million in cash and the assumption of $0.8 million in liabilities. The purchase price was preliminarily allocated to the acquired assets based on the estimated fair value of the acquired assets at the date of acquisition. Certain adjustments were made to the assets acquired upon a revised appraisal of certain tangible and intangible assets during the three months ended March31, 2010. The following table summarizes the aggregate purchase consideration paid and the amounts of assets acquired at the acquisition date (in thousands): Purchase PriceAllocation(1) Preliminary Purchase PriceAllocation(2) Current assets $ 6,165 $ Property and equipment 9,057 32,015 Intangible assets 30,122 (3) 19,260 Fair value of net assets acquired $ 45,344 $ 51,275 Goodwill (4) 5,931 (1) Reflected in the condensed consolidated balance sheet at March31, 2010. (2) Reflected in the condensed consolidated balance sheet at December31, 2009. (3) Consists of customer relationships of approximately $22.9 million and network capacity of approximately $7.2 million, as of March31, 2010. The customer relationships and network capacity are being amortized on a straight-line basis over a period of 20 years. (4) Goodwill is expected to be deductible for income tax purposes. The goodwill was allocated to the rental and management segment. Pursuant to the definitive purchase agreement, the Company is obligated to acquire

Business Segments

Business Segments
	3 Months Ended Mar. 31, 2010
Business Segments	12. Business Segments The Company operates in two business segments: rental and management and network development services. The rental and management segment provides for the leasing and subleasing of antenna space on multi-tenant towers and other properties for a diverse range of customers primarily in the wireless communications and broadcast industries. Through its network development services segment, the Company offers tower-related services in the United States, including site acquisition, zoning and permitting services and structural analyses services which directly support the Companys site leasing business and the addition of new tenants and equipment on its sites. The accounting policies applied in compiling segment information below are similar to those described in the Companys Annual Report on Form 10-K for the year ended December31, 2009. In evaluating financial performance, management focuses on segment gross margin and segment operating profit. The Company defines segment gross margin as segment revenue less segment operating expenses excluding depreciation, amortization and accretion; selling, general, administrative and development expense; and other operating expenses. The Company defines segment operating profit as segment gross margin less selling, general, administrative and development expense attributable to the segment, excluding stock-based compensation expense and corporate expenses. For reporting purposes, the rental and management segment operating profit and segment gross margin also include interest income, TV Azteca, net. These measures of segment gross margin and segment operating profit are also before interest income, interest expense, loss on retirement of long-term obligations, other income (expense), net income attributable to noncontrolling, income (loss) on equity method investments, income taxes and discontinued operations. The Companys reportable segments are strategic business units that offer different services. They are managed separately because each segment requires different resources, skill sets and marketing strategies. Summarized financial information concerning the Companys reportable segments for the three months ended March31, 2010 and 2009 is shown in the tables below. The Other column below represents amounts excluded from specific segments, such as stock-based compensation expense and corporate expenses included in selling, general, administrative and development expense; other operating expense; interest income; interest expense; loss on retirement of long-term obligations; and other income (expense), as well as reconciles segment operating profit to income (loss) before income taxes, noncontrolling interest and income (loss) on equity method investments. Three months ended March31, 2010 Rental and Management Network Development Services Other Total (in thousands) Segment revenues $ 443,818 $ 10,616 $ 454,434 Segment operating expenses 100,424 6,045 106,469 Interest income, TV Azteca, net 3,499 3,499 Segment gross margin 346,893 4,57